There are so many loopholes that it seems like the only solutions are to either create a well funded agency/department to oversee this, or to increase the price far enough that H-1Bs are only viable as a last resort.
Now, if the company really needs a worker brought in on an H1-B, they will be very happy and the H1-B queue will continuously clear itself. However, if all they want is an indentured servant, that will get quashed when the green card arrives.
Everybody wins--except for companies who abuse the H1-B program. Which is almost all of them. Which is why you never hear this solution.
If the visa is not attached to the company, then the wage deflation effect will be much more minor. After all, the visa holder could just go to the company next door and get a higher wage if the initial company tries to pay too low a salary.
The justification is that that there is a critical shortage of software developers (at any price? at market rate?) that threatens the US economy, so we should allow corporations to bestow "front of line" privileges on tech workers that other classes of immigrants don't get.
I don't buy it. Why wait a year, why not just award the green card the moment the immigrant shows up. And why require that the immigrant have a job offer from a tech company? In short, why not just let people immigrate, and allow them to enter the job market in response to market signals?
A dental hygenist earns about as much at the median in SF as a software developer. A registered nurse earns quite a bit more. Why not allow immigrants to choose those fields just like US citizens get to? Why force them to study tech fields and work even a year for disney in a tech role to get to come here?
I see a lot of H1B workers that would not fit my notion of "skilled" except for vanishingly narrow fields (those you can master after a week of training).
A good example of this problem currently is nurses in the Bay Area. They are very well paid however there is still a shortage because there isn't enough teaching available. The teachers are of course experienced nurses, so there's no way to increase the supply of teachers without further reducing the supply of nurses.
So while supply and demand will solve them problem eventually, you might have to wait 20 years and in the world of business someone else is going to eat your lunch during that time.
Obviously that would need enforcement, but they already do checkups on some of these things, and if they're paired with high enough fines these outsourcing firms won't risk it.
Its not a coincidence that decades of Visa abuse is ignored, there are bigger forces than these outsourcing companies namely, the chamber of commerce et al.
Edit: wording
At the end of the day, I'm sure this will get swept under the rug and nobody in an Executive position - at any company (Tata, Infosys, Southern Cal Edison, Fossil, Disney, etc) - will actually face prosecution as an individual for manipulating / corrupting the system. However, there may be a job or two lost in shuffling around in order to sign a declaration that "We admit no wrongdoing and promise not to do it again" which ties up the investigation and puts a bow on it. Case closed.
Yet another metaphorical example of how the top tier of "business leaders" and decision makers pander to the top tier of the richest individuals ("investors") and have absolutely no disincentive to continually gutting the middle class and young generation of US Citizen workers who are ridiculously underemployed at this time.
This worker's blog seemed pretty insightful: https://plus.google.com/+KeithBarrett/posts/PWA6BXs7dbS
Taking his comment about revenue focused technology being developed in that office, it doesn't seem like it was a smart business move to lose the experience of the staff they had in place already.
The US has reasonably good labor laws, but weak enforcement and too-small penalties.
